The Portland, OR real estate market experienced a drop in inventory over recent years. Low supply levels made things more challenging and competitive for home buyers in the area, giving them fewer properties to choose from and less bargaining power.
Now, as we get further into 2024, housing market inventory in the Portland area still remains low, though local real estate experts believe we could see a shift in this trend.
Portland Housing Market Supply Dropped in 2023, Though May Rise in 2024
During the second half of 2020 and all throughout 2021, the Portland-area real estate market experienced a sharp decline in the number of homes for sale. This was largely driven by a pandemic-fueled migratory shift and resulting surge in home-buying activity.
As a result of this trend, home buyers in the area found themselves competing fiercely for limited supply. This in turn boosted prices at an unprecedented pace.
In 2022, supply levels in Portland (and elsewhere across the U.S.) began to climb again. Demand declined due to rapidly rising home prices, and this led to a general cooling trend within the real estate market.
Housing market inventory in the Portland metro area began to increase during early summer of 2022 – a trend that would continue through the end of that year.
But during the first five months of 2023, the number of homes for sale began to drop again. Having said that, local experts are anticipating inventory to rise again in 2024 following a dip in mortgage interest rates.
The Monthly Figures Paint a Different Picture
Real estate market inventory is often measured by the number of “months’ supply.” This metric indicates how long it would take to sell off the current inventory of homes on the market, given the current sales pace in the area.
When measured in this way, housing market supply levels within the Portland, Oregon metro area have declined over the past few months. The short version is that there are fewer homes listed for sale today than at the beginning of 2023.
According to RedFin, there were 10.7% fewer homes sold in Portland as of December 2023 compared to the same time a year earlier.
And this underscores the point made earlier. While supply levels have increased year-over-year, the monthly figures show a different story. But again, we could see a slightly different story unfolding as we head further into 2024.
A Different Real Estate Market These Days
Home buyers in the Portland area might read this report and think: “Oh no, there goes the real estate market again.”
After all, we all remember the hyper-competitive real estate market conditions that developed in the early stages of the pandemic. Back then, a severe inventory shortage led to bidding wars, rapid price growth, and a lot of headaches for home buyers.
But things will likely be different this time around. No matter what inventory levels do in 2024, we probably won’t see the kind of fierce competition that occurred over the past few years.
For one thing, there are fewer buyers now when compared to a few years ago. Higher home prices and mortgage rates, along with general inflation, have reduced the pool of qualified home buyers. So there’s less demand these days.
Even with a reduction in supply, the Portland real estate market probably won’t experience such frenzied conditions anytime soon. It’s a cooler market in 2024, regardless of what supply levels are doing.
Advice for Portland Home Buyers in 2024
As a home buyer in the Portland area, you might have an easier time finding a suitable property within your budget. The reason for this is something we’ve already stated in terms of the possibility of a slight increase in housing supply.
Still, the local market could be competitive for buyers later in 2024 – especially if the recent inventory declines going forward.
You can increase your chance for success by making a strong offer the first time around. To do this, spend some time reviewing recent home sales in the area where you plan to buy a home. This will help you determine the best offer amount, based on what similar homes have sold for in the same area.
You can also benefit from expanding your search area as much as possible. Inventory levels, home prices, and competition can vary from one city or community to the next. So you might be able to get more house for the money, and with less hassle, just by shifting to a different ZIP Code.
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